>> Narrator: Live from Chicago, Illinois it's theCUBE. Covering VeeamON 2018. Brought to you by Veeam. >> Welcome back to VeeamON 2018. This is theCUBE, the leader in live tech coverage. My name is Dave Vellante with my co-host Stu Miniman. #VeeamON, our second year of VeeamON coverage, this is day one. Carey Stanton this year is the Vice President of Strategic Alliances at Veeam. We're having a great conversation about it. Hockey, Cape Cod. >> Golden Retrievers. Golden Retrievers. >> Oh, I love dogs. >> Dave, how many times do we travel the world and talk to a local? (laughs) >> Boston area guy. >> So welcome to theCUBE. >> Thank you very much. >> And welcome to Boston. >> A year and a half in Boston, right downtown empty nesters. My two children are back doing university in Canada. I've got a sophomore and a junior so my wife and I are living in Boston empty nesters, it's awesome. >> That's great, you've got to love it. And I love the fact that you're from Ottawa, but you're a Bruins fan. >> Yes, I've basically turned into a Bruins fan. I'm a Red Sox fan and a Patriots fan and the Celtics are in the playoffs. >> Yes, love this guy. >> You'd better be if you're working for Peter MacKay. >> Yeah, you have to. It's like you have to sign in. And I've worked for Peter for 17 years, three different companies. >> Okay, so you were at VMware. >> I was at Vmware, I was at Desktone, and then we did IBM and part of that was Watchfire which we sold to IBM. So, a long journey. >> So give us the update, what's happening in alliances. >> Yeah, so it's great. As you know we have our global reseller agreement that we announced most recently with NetApp just in March. We're now on their GPL. We went live on Cisco, we announced Cisco back in August but we went live on November 15th and we have HPE and all three of them are just exceeding expectations as far as the demand and the interest we're getting from our sellers. As you've seen from Peter and Veeam, we're targeted to the enterprise. We have our messaging our own hyper-availability. So these partners bring us a huge opportunity by working into their customer base, but we close 133 customers a day, right you heard Peter mention that. But we're bringing them into our customer base which is traditionally SMB and commercial and we're working with them on their enterprise. But an exciting stat for that one is that we say no naked Veeam. When you sell with an alliance partner it's six to eight times larger than if we sell standalone. So it's working, the messaging and the enabling we have with our field and we're 100% channel. So that's working very well on just the enablement with Jeff Giannetti, Sean, and Olivia, and Ameya. >> Well the other thing that you guys seem to have done is figured out how to take a long view, a strategic view with these partners. Many organizations, they look for the tactical. Okay, how much money >> Yes, yeah. are we going to make this year? You're looking at the lifetime value of a customer. >> Correct. >> It's frankly quite unique in this business. >> Well, the interesting thing we're doing which is not just on the global resellers which is on all of our partners is that we look and say what's a good partnership look like or what's the great partnership look like. And what we have is the investment that we are because we're private is we'll do the front-end investing up front. We'll do a joint business plan, have shared metrics across the table. So whether that's with Pure Storage or with Nutanix, with our VMware, Microsoft, we front-load all of those investments. To your point, is that we're not just waiting to see did we have success year one and then we'll invest year two. We take that three year business case view up front and do the front-end load investment. So, what does that mean? That's a dedicated business development team. We have 25 people working and go to market with HPE or 12 working with Cisco and we take that from technical architects, field marketing, product marketing and to make that in clot entire plot. >> Yeah, Carey, I wonder if you can give us a little bit of a compare and contrast. VMware built one of the best ecosystems out there. We already talked once today. For every dollar you spend on VMware you did 15, 20 dollars with the ecosystem, Veeam's nice vibrant ecosystem >> Yes. getting deeper with some of those partners. Give us a little compare from your previous life. >> Yeah, sure, so at VMware no question that they had that solution so we take that here as well and we call it the Veeam Currency. So when you're going in and selling Veeam, if you're selling an average selling price of $10,000, we're working with our partners where they're seeing that that deal is going to turn into a $50,000 traditional with an alliance partner sale in conjunction with their hard work. So they're managing the entire software process so they're seeing their up leveling the messaging so no longer just pinpointing at a hardware solution. And they're increasing their average selling price by 10x, so Cisco is at a great set. 10x, again I'll repeat 10x with Veeam on doing those deals. First it's just trying to go in and sell HyperFlex Standalone. >> It's just a really critical time in the industry right now. Our research shows that there's a gap between what the business expects in terms of the degrees of automation, the level of quality of services and what IT is actually delivering. So that says that customer base is really ripe for churn in a lot of accounts. And so you guys being aggressive with partnerships in regard to making that investment as a private company, the timing frankly couldn't be better. Especially as you go from what was a virtualized world where you guys did very, very well to now this cloud, multi-cloud digital, you know throw in whatever buzzword you want. But, we are at an inflection point. >> Yeah, we sure are. I think that what we're seeing with our partners especially on HPE and Cisco and Nutanix is they're all near hyper converged and so they're going in a whole different sales motion. We're seeing it on our hybrid cloud, we're a number one close sell partner with Microsoft. So we have our backup, native backup to Azure and so we're seeing this destructive market in the market place and we're also seeing a lot of our partners have competitive takeouts of Dell Avamar, right and their data domain. So we're going in and taking out Dell Avamar and they're going in and data domain so we have a lot of synergy and so as these traditional vendors such as Avamar, Veritas, Commvault, and the IBM Tivoli Solution is that we have those sales motions going with our partners that are going after those hardware solutions. So, again, it's very synergistic with our tier one partnerships. >> Well you see a huge drive towards simplicity. I mean, another thing you guys do really well is, and it sounds so simple, but you're compatible with a lot of different clouds, for example. So more work loads, more environments increases your TAM and your friendliness to partners. It sounds simple, but execution is not. >> Yeah, we're a Swiss based company, we remain. The Switzerland is that we work with all partners in all routes and so we've seen a lot of success in that way. We see a lot of demand coming from our customers, our partners wanting to work with us in these multi-cloud solutions that we have with Microsoft. >> Biggest challenges, is it a channel conflict? Dealing with deal registration, I mean, what are some of the challenges you guys are facing? >> I think that challenge is just enabling our sales teams on how to work with these partners and to understand the sales motion. And some of our sales execs are 20 year veterans that have come in and worked in a traditional place where when you went out to tackle an enterprise deal, you did that standalone. And we realize that we don't take any deals direct. So just getting them in the sales motion with our partners is a challenge, but one that is easily adapting to success that we're having in the field. >> Alright, Carey I know you're super tight on time. We promised to get you out >> Yes, sir. of here. We've got to leave it there, but thanks so much for coming on theCUBE. We really enjoyed having you. >> Okay, thank you very much. >> Alright, keep right there everybody, we'll be back with our next guest right after this short break. You're watching theCUBE live from VeeamON 2018. (techno music)

>> Announcer: Live from Las Vegas, it's theCUBE! Covering VMworld 2017. Brought to you by VMware and its ecosystem partner. >> Hey, welcome back to theCUBE. Live from VMworld 2017 day one. I'm Lisa Martin with my co-host, Dave Vellante. Very excited to be joined by our next guest. CUBE alumni, Peter McKay, President and co-CEO of Veeam. Welcome to theCUBE, welcome back. >> Great to be here, thanks Lisa. >> Good to see you again. >> Good to see you. Fellow Bostonian. >> Dave: Yeah, alright. Go Sox! >> Good to be here. >> Dave: It's not looking so good right now. >> Aah, and it only matters how it ends. >> That's true. Yep. Until October, it's not over 'til it's over. >> Peter: Not over until it's over. >> So, some good news. You guys were just named a leader in the 2017 Gartner Magic Quadrant >> Peter: Yes, we were. >> for Backup and Recovery. What is next generation availability for, the enterprise has to always be on, 24/7? >> Yeah, you know it's a category. We call it availability. And now, kind of the market has adopted this availability label term. And it's really around any application, any file, any service. Access to your data at any time. So, it's always on. Always available. Seven by 24, 365. And more and more companies need to be always on. And so it's not, it used to be it's just about back up, back up, and you can back up a hundred times, but it's about the recovery. The time to actually get back up. And so, that's becoming a bigger driver for a lot of companies. They need to be always on. So, this category of availability is what we focus on. Everybody at Veeam, wakes up every morning thinking about how we can help our customers stay up and running and always on. Always available. >> From a buyer's perspective, are you seeing this elevated to the level of the C-Suite or are you still talking more with some of the guys and gals in IT or at lines of business? >> So, I would say, if you asked me two years ago, it was definitely IT-centric. More and more, as you start to see, British Airways, I mean, almost everyday you're seeing another outage. Major outage of a service or access to data or Australian Internal Revenue Service equivalent being down for days. It's starting to be a bigger issue and CIOs, CEOs. It's a major focus here, and not just for the cost of revenue, but also just the brand, associated with it being down. And with new buyers, these new millenniums and people always on access to devices. You know, if you have a shoddy service, they're going to go elsewhere. And so, more and more companies are focused on that being a differentiator for their business and that's why it's elevating up the C-Suite. >> I've personally been, sort of, getting more knowledge about Veeam in the past six or seven months. We had you guys on at HP Discover in London. And then of, course, we did Veeam On. You were at Pure Show. You were at the Nutanix show. >> Nutanix show Yeah. >> The HP in Vegas. And I just recently ... >> Peter: So, it's been more than four. >> Yeah. And I just recently presented to your alliance team back in Boston. So kind of getting the feel for what's going on here. >> You're going to be an expert at Veeam. >> I am starting to. So, one of the things I'm noticing is you guys are moving up market, getting into the enterprise. Talking a little more CIO, CXO language. So, I want to challenge you on something, Peter. And you've really brought in a lot of that new branding and messaging. A lot of people talk about digital transformation. And to us digital transformation is all about how well you leverage data. So, in your mind, is that a viable sort of definition, if you will? And how is Veeam helping its customers particularly upmarket leveraged data? >> Well, more and more companies are leveraging data on almost every aspect of their business. To drive new markets. To drive new products to market. And so the importance of data in this digital transformation, they call it the currency of digital transformation. The more that data is growing in its importance, the more the need for accessing that data and to have that data always available for you to make faster, quicker decisions is only growing. Not only is it the size of data, but it's the ability to access it at all times, in any location. On premise, off premise. Is becoming more and more because of the importance of data, right?. So the applications need to have access to it. Decisions. I mean, I look at our business. More and more of what I do everyday is off of data we're accumulating and how we drive our business. How people are buying. How we can market our products better. So if we're just an example of what we're seeing, not just in the enterprise, but in that medium sized business as well, where data is becoming a crucial differentiator. And one of the leading movements. The kind of drivers of digital transformation. >> I was going to ask, is that the underpinning of your enterprise portion? What you're saying is, not just the enterprise, it's the small businesses as well. >> Peter: Yeah. >> It really was just simplicity, which was the attractiveness to Veeam historically. >> Peter: Yeah. >> You're saying that's changing and it's becoming a data centricity. >> It is. I think as the importance of data. But it's not just the accumulation of data and the access of data, but it's also regulatory and security is also driving that, right? You need to, you know, with regulation, DDPR in Europe is becoming a bigger issue, right? And so, how are we managing that data? What are we doing? Are we in compliance or not with that data? Making sure that data is secure and you can back up, if there's ransomware. So, you look at a lot. As you accumulate this personal, identifiable information on people and your customers. The protecting of that data. The making sure that that's always available and you're in compliance. It's just growing in importance. Which has been a major driver for the growth of our business over the past couple years. >> Could you talk about that growth? What kind of metrics? You know you're a private company, but what kind of metrics can you share with us about recent growth, recent quarters? >> Yeah. So we're growing at about 35% year over year. So that's been kind of consistent over the past two, three years. We have 256,000 customers. We're adding about 4,000 customers a month. Small, medium and now, larger companies. The growth continues to drive. All of that is through our channel organization. Our alliance partners that we've continued to add. Steady, up and to the right has been our business. >> Well you've said, your stake in the ground is a billion, right? >> A billion. We're on track. Our goal is 800 this year. A billion next year. And 1.2, 1.5 in 2020. We're well on our way. >> So, speaking of partners, you were a VMware guy for a while? >> Peter: Yes, I was. >> We were talking about that. And you've been with Veeam for about a year or so? >> Peter: Year and a half. >> Tell us about, what was, the theme that we've had for the last couple of hours is that data protection, backup and recovery is a hot topic. It's something that you've probably seen evolve over time. Tell us about some of your thoughts on some of the announcements today that VMware has made regarding helping customers migrate to the cloud around data protection. What are some of the things that excite you about working with VMware? >> Well, I think most companies have a hybrid strategy in that medium. Definitely small is moving to either buying applications in the cloud or moving more off premise. That's in the S and B market. Anything above that, it's a hybrid story. There'll always be an on premise. There'll always be kind of a cloud component. And we're seeing a multi-cloud component. And so the announcement on VMware cloud on AWS is important. We're the only solution that is ready to go from a backup recovery. From availability perspective. VMware is an incredibly important partner for us. Announcements around anything data protection is critical because we built our business on the back of VMware's virtualization and vSphere. So whenever you talk virtualization and data, that's Veeam. But also security in moving, allowing that flexibility of moving from off premise to cloud solutions. That's music to our ears. That's a big part of what excites me about the VMworld in 2017. >> I'd love to get your thoughts on the market. I mean, it's on fire. VMware is booming. The data center is smoking hot. If you look back. Take your VMware experiences, look back two years ago. VMware as a company was under fire. Its license revenue was down 1% to flat. Now it's growing. 13% I guess is the latest quarter. Cash flow is cruising. The stock's doubling. Is this, in your view, sort of a product cycle thing? Updates of ELAs or is this a sustained recognition by the customer base that not everything is going to go into the public cloud, that we're going to bring the cloud operating model to the business. What's your sense? >> It's a great question. I think a big part of this is ... I do think it's a, it will be a sustainable growth going forward. I think a big part when I was at VMware. They had the whole vCloud Air cloud environment, which was confusing to the public cloud. And for customers because I think people didn't buy in on the vCloud Air strategy. I think what changed it. One aspect that changed it for VMware was this VMware Cloud on AWS announcement. Which, a lot of companies want to move to AWS and want to move to the cloud. But they want to do it with the same infrastructure that they have on premise, so if you can give them vSphere, the same kind of stack, but in the cloud, >> There's a pathway. >> it opens up opportunities. And that's when we started to see a VMware where companies would do a one-year, two-year agreement because we weren't sure of their long term cloud strategy. Now, they are. That's a great model. That's a great plan. Now, I'll go three, four years with VMware because I like that strategy. And it's great for AWS because they weren't getting a lot of mission critical apps going to AWS in the enterprise. But, now you've got VMware infrastructure that makes it so much easier for companies to take some of this on premise mission critical and move it to the cloud. So, I think it was great for Amazon. Great for VMware. But I also think a lot of some of the smaller drivers, I think Microsoft kind of not focusing as much on Hyper-V has kind of led vSphere to kind of rebirth of vSphere in the market. We see that growth and we're pegged a lot to the vSphere and Hyper-V, the whole virtualization side. I think it's part of VMware getting a better strategy for the cloud, but I think it's also customers kind of getting comfortable that it's not going to be this massive shift to the cloud. It's going to be a hybrid story. >> Well, it's interesting. The vCloud Air piece was always, even go back to Maritz, it was the recognition that the advantage that the hyperscalers had was homogeneity. vCloud Air was always homogenous, like to like. Or what Oracle called same same. And so, in effect, what VMware is doing, I wonder if you agree with this, with AWS, certainly with IBM, and potentially others, is similar to the vCloud Air strategy. They just don't own the cloud. >> Peter: Yeah. >> So, it's a two-edged sword. VMware did a debt, they raised about another four billion. Their CapX is relatively low. >> Peter: Yeah. >> Couple hundred million. >> Peter: Yeah. >> So, they don't have all that Hyperscale CapX. That's an advantage, but at the same time they don't have the vertical integration. >> Peter: Yeah. >> What's your thought on that as a sort of observer? >> That's a big ... I was acquired into VMware. >> Right. >> Three year, four year, whatever years ago from Desktone. And the CEO of Desktone came in. And it was desktop as a service, so desktops in a cloud. And so I got the whole vCloud Air and the cloud market and I kind of said when I came in, I think building your own cloud is, don't do it. Because it's going to suck a lot of cash and it's all up front when you're behind in the race to the public market, right? You had IBM already there. You had Amazon there. You had Azure, Google. VMware was going to be late to the game on vCloud Air. And so, I thought it was the smart move of kind of moving that out. Plus, VMware with vCloud Air alienated the other managed service providers that are building a business. So, you're almost competing with the same people you're trying to load up with your technology. >> Dave: Yeah. >> So, it was like, no. Stay neutral. Stay out of that. You've stayed out of the hardware. Stay out of the cloud. >> So, I want to bring that back to Veeam. Because for you guys, I think the clarity is a great thing. It reduces all that friction and all that noise and now the mission is clear. I wonder if you can comment on that? >> Peter: Yeah. I think that was the, that's what the market wanted. More clarity on what's your cloud strategy. That was I think the biggest mover in the market. VMware's growth has really came when they flicked that switch. When they announced that whole Amazon strategy. And I think it helped us because we're an obviously strong partner with VMware and strong partner with Amazon, so putting them together is perfect. That's why we were able to do it faster than anybody. When you go by our booth, you can see it. We demo it. It's all up and running. But, I think it helped VMware get clarity on their strategy. It helped Amazon and it drove our market. >> You guys draft right behind that. >> We just draft in right behind you, right? So I think that was a good move for everybody. >> Last question for you as the CEO, co-CEO of Veeam. Been around in this space for a long time. What are some of the core things that Veeam does to attract and retain talent as we look at technology like backup and recovery that's hot again? >> Yeah. Well, you know, I think it's a, you've got to, I think a lot of it comes down to culture. We've got, I mean, we've always had great technology. So the product has always been the driver. It gets in, it does a really good job. And then it becomes, then it's the people. We've got a great culture of people. We call it hungry, humble, and smart people. You know, and we have fun. We drive, we're aggressive. We're scrappy. We're hungry. But no egos. In our partner community, is similar. And so, I think it makes because of that you get a reputation and it's kind of a spot that people want to come to. We've done a good job of as we're growing, we've invested in our team to make our team better. But we've also brought in a lot of skill set. Especially in the enterprise where we need to get more skills outside of kind of S and B and commercial. So we've done I think a good job of merging, the investment in our existing team with a lot of really good skills and expertise that we didn't have but also fit the culture. So keep that founders, that Ratmir's founder mentality as the business grows and scales. And make it still being that fun scrappy software company that made Veeam what it is today. >> Yeah, it kind of gets to my last question which was you guys are maturing even though there's a lot of immature things going on. >> Oh yeah. >> Dave: Which is a lot of fun. >> It's fun. We can talk about that ... (laughter) >> All good. But, we talked about this. Veeam's ascendancy was during the virtualization craze. And you guys really got a strong foothold. And beat the competition. And now you're seeing a lot of emergent cloud data protection guys. Very well funded. Hundreds of millions of dollars in a business that's not capital intensive. How are you going to maintain your relevance there? It's a big part of your job. >> Peter: Yeah, it is. >> It's a big part of why they brought you in. >> It is. I mean, a lot of it is kind of continue to do what we've done in terms of being as you grow, and as you scale, don't lose the aggressiveness. It's, think big, right? We've always been taking bigger and bigger steps as an organization. Taking risks. Being aggressive. Being bold. Doing things that you do it as a small company but continue to do it. And that's still with our founders. That's the mentality of our business. A big part of my job is to make sure we don't lose that, right? As you get to 800 and a billion, still be that hungry and aggressive and scrappy company that we were six years ago, seven years ago when we were much smaller. But it's even more important today to be that as we move forward in this hyper competitive different market that exists. We've just got to be so much better every day. Every day that we come to work, we got to be better than we were the day before. >> And scrappy and hungry. I love it. >> Peter: Scrappy and hungry. (laughing) >> Peter McKay, thank you so much for your we'll say nth time on theCube. >> Yes. >> Lisa: Does that work? >> That's fair. >> Alright. For Peter McKay, the President and Co-CEO of Veeam and my co-host, Dave Vellante, I'm Lisa Martin. You're watching theCube live from day one of VMworld 2017. Stick around. We will be right back. (techno music)

>> Announcer: Live from New Orleans, its theCUBE, covering VeeamOn 2017. Brought to you by Veeam. >> We're back in New Orleans. Peter McKay is back, co-CEO, and newly-minted co-CEO, and Sanjay Poonen is here, the CEO of VMware, longtime CUBE alum and friend of theCUBE. Great to see you, thanks for coming on. >> Thanks, it's good to be here on your show. >> So, Sanjay, you were up in the keynote talking about the partnership with Veeam, your relationship with Peter. So let's start there. You guys have known each other for a long time. You acquired Peter's company into VMware. You guys had a great run up. Start there. Give us a little background on your relationship. >> Well, Dave, relationships make the world go round. I was very fortunate, almost I think on my first week at VMware to meet Peter in the context of a possible acquisition of Desktone. It was the first deal I did at VMworld a few months later. He was just a delight to work with. And, you know, we just give him more and more responsibility. At some point we ran out of things he could do. And he is now here. So we are very proud of him and all he's doing at Veeam. And Veeam's been a great partner of ours. I mean the level of integration have gone into our products. I was just so proud to see all of VMware products and Veeam products making our customers happy. And that's really, really a great story. >> I want to spend a second on that. I mean, obviously we're here to talk about Veeam and VeeamOn and we will, but that business was a struggling business. I mean admittedly when you came on and prior to the acquisition and did some really hard work. I mean, Citrix dominated that business and it really didn't take long for you guys to get a groove swing going. How did that happen? >> And it's a great story. Sanjay did all the heavy lifting there. It was just fun to really watch that transformation happen at VMware. It was, I mean, Desktone was a piece and I kid Sanjay that it all changed when they bought Desktone, but that really was the, it all changed when Sanjay came on board and really transformed that business that was, like you said, struggling and gave it direction and enthusiasm and built the momentum of that business to really look at that market and say these are the things we can do. With a great vision and a great strategy pulled together and a strong team, I was just fortunate to be part of that as I kind of moved through VMware. And it was a great experience and I learned a lot from Sanjay as we went through that process. >> I mean you have always been very humble, and said it's the team, it's not me, and I'm sure there's a lot of truth to that, but what is it, the piece parts, the right technology? I mean obviously, you know, VMware has always had great vision. But just all came together. >> Yeah, I think that sort of starts where Peter left out. And it starts with team. I'm a big Warriors fan. This week I'm a Celtics fan, too. We'd love to see the Celtics play the Warriors. But it's strength in numbers, and you know Peter was a key part of that team, Sumita Won, Noah, the list goes on. People on his team that he brought, like Dave Grant, and many of them take on bigger and bigger jobs. As I moved into my new role, I groomed Sumita, he's now taking that. So it really always starts with a team. We believe that strength in numbers. We've hired what I think, and groomed, the best team in end user computing bar none. Secondly, we really had a point of view and a vision of certain things that were going to remove the two Cs that I think have plagued the space: cost and complexity. And one part of cost and complexity, the cloud, things like Desktone, later on moving to things like AirWatch in the cloud. And as we did that, we really, really start to embrace these vectors of innovation. And the third is embracing the ecosystem. To us the ecosystem is hugely important and you know, you think about companies like Apple and Google, they were irrelevant to VMware, but now in the context of end user computing, Apple and Google are embracing us. Further into the cloud, AWS last year, yesterday we announced that Horizon Cloud will run on Azure. So the ecosystem is the third pillar of what we've done. I think all three of those are key reasons we've been successful. >> Well and VMware has had an epic ecosystem. So what, Peter, can you learn from that and how do you apply it at Veeam? >> I've learned a lot. I was there for three and a half years and it was a great learning experience for me as I look to kind of how VMware really addressed a lot of the customer challenges, but also had a great vision for where they wanted to go. And so when I came over to Veeam, it was very much, and to be honest, Veeam really piggybacked on a lot of the things that VMware did over the years. Same approach to the sales model, a lot of the same partners, and our customers are pretty much overlapping. And so what we've done is just, I've learned a lot from the things that really went well at VMware and I brought a lot of that best practices over to Veeam in the 10, 11 months that I've been here. I think there's a lot of things that we can do. And a lot of it, that Sanjay said, the ecosystem, that's a big part of what I've been doing since I came here, is broadening our ecosystem partner community to make it easier for our customers, especially in the enterprise where they want us to work better together, not just technology, which we've done a really good job, but expanding past technology into how do we work better in the field together and how do our partners interact together. And that's really worked out very well for us. >> Sanjay, in your keynote you talked about a lot of the joint customers VMware and Veeam, we talked in the intro about the ascendancy of Veeam kind of riding the VMware wave. One of the questions I had from a lot of the community coming in is, if you look at things like VMware on AWS, talked about the Azure piece there, how does the relationship with Veeam fit there? Veeam obviously has its multi cloud strategy, but in the cloud, how do customers know that VMware is going to, you know, stay partnering with companies like Veeam? >> Yeah, Stu, I think it's a really good question. For us, as we kind of looked at our hybrid cloud strategy, we had to actually make some changes. Eighteen months ago, if you asked VMware about our hybrid cloud strategy, you probably heard vCloud Air as the first thing we talked about. We've since then divested that asset. We've changed a lot of the way in which we've done. We worked to embrace the public cloud. Our partnership with AWS, a preferred primary cloud partner, that has been enormously helpful in giving people a vision of where the data center is headed. But as we've begun to do that, and you'll hear more about kind of the GA of that offering as we approach the summer round of VMworld, but what we're doing with AWS, a couple of things started to play out where customers were asking us for some add on services for VMware Cloud Foundation running on AWS. And the two I began to hear most often with customers were around security and around data, issues like backup. So we began to create a list of ISVs that we really want to kind of work closely with. Companies like Palo Alto, for example in security. Companies like Veeam in the backup area. And it's not to say others aren't important, other topics, but these are the ones that are very important. And VMware always, you come to VMworld, hundreds and thousands of companies have made themselves successful on our platform. We want to continue that. And then what we seek to do it just like you saw on stage today and have the product managers and the technical product marketing folks really integrate products to see vRealize and Log Insight and vSAN. Of course vSphere is so deeply integrated with Veeam, and them taking advantages. You know, it benefits their 200,000 plus customers, which is a big subset of our 500,00 customers. >> Peter, I heard in Sanjay's keynote, talked about things like containers, some of these newer technologies, openStack. How do those play into the partnership? >> Well I think as we started our partnership all around vSphere and it kind of expanded as Sanjay said, we continue to look for ways that we can work better together development-wise, but also go to market. So we've integrated even further with vSphere, as he said, vSAN and vRealize. And a lot of that is opening up the platform for containers and other cloud services that we continue to integrate with. And so I think we're very, our development organizations are working very closely. As VMware is expanding its reach and its platform, we are doing it as well. And so that's a lot of why I think you see the success we've had between the two companies. >> Question for you guys on cloud. You know, you do the SWOT analysis. And sometimes you get confused, is that an opportunity or is that a threat, right, okay. So cloud is one of those. Obviously building your own public cloud is not an option, no longer an option, not really ever been an option for Veeam. How do you make cloud an opportunity, each of you? >> Sanjay: I'll let you start, Peter, and then I'll. >> So for Veeam, way back in, three years ago, four years ago, they made it a major investment into a managed service, companies who are building a cloud. And we've built that up to, as I said, 15, 16,000 of these partner and managed service providers and cloud providers. And this is the world that I lived in from my Desktone days. We always believe that as part of, this on premise, this public cloud, and we continue to, Amazon, Azure, and Google, but we always believe that there is companies that have this special value add, that a lot of companies were going to go to, and we thought that was the managed service provider community and the systems integrators or the strategic outsourcers. And so three years ago we started to invest very heavily in building that and helping them build that business around Veeam. And that part has turned out to be a fantastic part of our business. Now about almost 30% of our business is coming from those providers that are selling cloud services, managed service providers, as well as now the new public cloud is becoming a bigger part of our business. So, for us, yeah, you could look at it early on, as maybe that's a negative, but it is by far the focus for our business going forward. >> I would just add, you know briefly building on that, we had a very similar approach. I think when I was last time on theCUBE I described our approach in this analogy. Imagine 500,000 customers, you know 40, 50 million workloads sitting on this island called VMware, a continent called VMware. And around it started to appear island. Four thousand of them have embraced VMware, the same service providers, the ones he talked to. But the biggest four we were wrestling how would we become relevant to them. And you have to look at this no longer as a threat, but an opportunity. I fundamentally believe when you face a crisis, you can either go down the path of a disaster or an opportunity. We began to say, we want to be the infrastructure software bridge into every public or private cloud. So which means, you know, if it's going to be AWS, we want to build that software bridge that allows workloads to move there, come back if they choose to, and then specialized kinds of workloads that might sit on the cloud. So we started out with IBM Cloud and AWS Cloud, but then our customers said we'd like to have the VDI service that you're running on IBM also run on Azure because it's a Windows workload. Okay, we can do that. And that's what we announced yesterday. So we're going to be very focused in getting this thing successful for our customers. And where they are seeing the public clouds as part of the infrastructure service, we're going to go right there with them. >> And to the extent, Peter, that you can cut costs and complexity better than anybody else, then you become a more attractive partner to VMware and then you get that virtuous cycle. Gents, great to see you both. Thanks very much for coming back to theCUBE. >> Always a pleasure. >> Thanks for having us. >> Thank you very much for having us here. >> Thank you. >> Alright, keep it right there, everybody. We'll be back with our next guest. We're live from VeeamOn in New Orleans. Be right back. (techno music) (musical computer tones)

>> Voiceover: Live from New Orleans, it's The Cube. Covering VeeamOn 2017. Brought to you by Veeam. (funky electronic theme music) >> Welcome back to New Orleans everybody. This is the Cube, the leader in live tech coverage. We go out to the events, we extract a signal from the noise. My name is Dave Vellante and I'm here with Stu Miniman. Ratmir Timashev is here, he's the co-founder of Veeam and he's joined by Peter McKay who's the co-CEO and president. Gentleman, good to see you. >> Good to see you. >> Welcome to the Cube, congratulations on the great keynote this morning. >> Great to see you, Dave. >> Seemed like you guys were having fun out there. >> Yeah it is, it's a lot of fun, it's a great, great time. >> So Ratmir, I want to start with you. A lot of people in our audience may not be familiar with Veeam. We've been sort of sharing with them, the rapid ascendancy of the company. But come, go back ten years, why did you start, you and your co-founder, start the company? >> Yeah, the company's ten years old. Last year we celebrated ten years, it was started in 2006 by me and my partner who is the technology side. He's my technology genius. I'm on the sales and marketing. So we started the company with the simple idea to build the new version, or new generation data protection for virtualized environments. VMware was getting hot back in 2005, 2006, 2007. It kept more and more penetration within enterprise. Back then the cloud was like, 10 or 20 percent penetrated, but we saw that, it's going to be 90 eventually, so we wanted to ride this big wave, technology revolution wave. And now I think we, looking back ten years I think we're in a very similar spot with the cloud. Cloud is where visualization was 10 years ago so and we want to ride this new wave or the cloud wave the same way exactly that we rode the VM wave, visualization and hyper-V wave. >> You know that's interesting, I was explaining to the audience this morning that your ascendancy coincided with Vmware and what happened was we consolidated resources and the one resource that was so precious was for backup and everybody had to re architect their backup and you guys were the, were an answer and obviously one of the more popular answers. Now we're into this cloud era and you see a similar opportunity, you're messaging sort of focuses on that and there's an emergent strategy that you're >> Yeah. >> putting forth. >> I mean I think everybody is moving into a multi cloud environment, right? Where there's going to be, their data's going to be all over the place, they're going to be on premise or manage service providers or in AWS or Azure and so and for us we need to be able to make it available and always on and so that's our focus is to make it very easy for our customers to store their data and run their applications and always be available no matter what the environment is. On premise, off, no matter what the infrastructure is. >> So we talk about digital transformation a lot on The Cube, every event we go to, it's digital transformation, you guys had a little bit different spin on that, digital life, always on, availability, capabilities. You're having fun with green. (laughs) >> Ratmir: Yeah. >> Peter: Oh yeah. >> Green is, >> We always have fun with green. >> Green is go. >> As you can tell. >> A lot of things you can do with green is go, color of money >> Celtics, right? Boston Celtics. >> Boston Celtics. Number one pick. >> Veeam green team. Veeam green machine. >> Veeam green machine, love it. So give us your perspective on this whole digital life. What is that all about? >> Yeah so our message in the last 10 years has evolved. Originally when we started our message was very simple. We're number one VMware backup. That message really resonated and we did deliver on the purpose of number one VMware backup. I remember first time when we introduce that concept, our competitors look at us like who knows them? But then we did in fact become the number one VMware backup, so And our message has evolved over time so from technical message to, that is focused on our core customer which is IT prone. The person that really understands the modern technologies, responsible for the modern data center. Understands the modern storage cloud technologies and visualization technologies. But that message has evolved as we are growing, becoming bigger, and we're going more into a enterprise so now solution become bigger and broader. That covers cloud. So we had to evolve our message so right now our message is, has become more consumer centric, more emotional, touching our digital life. Because we believe that that's at the end of the day, that's what we do. We enable our customers, our businesses to provide this seamless digital life experience for their users. That's what we do. >> So I love it when a successful company brings in a new leader. Because as opposed to things are bad and they have to make a change, we saw this last week, I mentioned I was at ServiceNow Knowledge, Frank Slootman, incredibly successful CEO, stepped aside, brought in a new, and part of that transition was about reaching a new constituency, so my question to you, Peter, is traditionally the Veeam audience is hardcore operational people. Your messaging is much higher level in the organization so how are you dealing with that sort of bifurcated personas, who are you targeting in this sort of new messaging? >> So as the, in the early days of Veeam it started in kind of that SMB market and kind of expanded into commercial and now very focused on the enterprise and so a lot of the enterprise are kind of working through this transition. The digital life and the new, staying relevant to the new users that are coming online and so we've found that our message needed to evolve as well and it needs to be, lines in business now are getting more involved in some of the decision making so our message wasn't where it needed to be in terms of evolving it for that enterprise customer and one that we think will foster that digital transformation for a lot of our companies customers and so we view this was the right time, especially with version 10, version 9.5 which was very successful and version 10 which really expands our enterprise capability but also we needed to, it broadens a lot of the applications down to things that we could do in an enterprise and we needed that message to also be kind of that enterprise in a broad strategic message. >> Peter, when I talk to customers these days, it's a very fragmented market out there, I think, as Ratmir said you rode that VMware wave, now customers adopting lots of sass, they're doing multiple public clouds, they're trying to figure out how they modernize their private cloud. Before it was VMware, therefore I need backup. Now it's how much does their choice on where they put their data and their application drive to you, how much do you have kind of the brand Veeam out there to kind of pull into those other environments and do customers turn to you for help in sorting out that kind of multi cloud world? >> Yeah actually I was talking to a friend of mine who is a key analyst at ESG, Jason Buffington, you know Jason. >> Yeah he's coming on. >> He had a great point about the industry, that our data industry or storage industry or data protection industry, he said that every new wave you go from mainframe to client server, from client server to visualization, from visualization to cloud. There is always a new backup leader. Because the technology changes so much and the people or the company that doesn't have this old baggage with the old technology, old agent based or supporting all these legacy platforms, that can move much faster and that's what Veeam has demonstrated with visualization. The only exception is the transition from visualization to cloud because cloud is based on visualization. So and based on the concept of the data mobility, and that's, from the mental concept to visualization and so we believe that we are very well set with our leadership position in visualization to also dominate cloud market because our technologies are modern technologies specifically built for visualization and cloud. >> And is the argument then that an Amazon or an Azure won't dominate that, because essentially they are a cloud stovepipe, is that right, can you expand on that a little bit? >> That's the way we look at it, I mean it's choice. People want to put, they should be able to put their data wherever they want or their applications, and we should make it very easy for them to do that. If they want to do an Azure, but it's not only just putting it in Azure, it's being able to get after it, get it and move it and transfer data no matter where wanted to so for us it's about providing the flexibility to move the data or run the apps no matter where you want at any time. >> Peter you ran a company that Vmware acquired that was an Azure service. Veeam has some Azure service solutions, customers often times are trying to switch from there's no more shrink wrap software anymore, models for buying it, where do you see customers in that adoption? Curious of your old role and kind of today what you're seeing. >> It's interesting, so Desktone was very much of a platform for managed service providers and cloud providers and so in coming to Veeam, a big part of our business, which is very different than I think a lot of the other people in the market is focusing on those cloud providers. Not just Amazon, Azure, the public, but also we have 15, over 15,000 managed service providers and cloud providers that run our platform as a business. And so when we rolled out a number of features here that if, unless you were a managed service provider or a cloud provider, you wouldn't get the multi-tenancy and the things that we built on scalability that are really changing the game we believe for the managed service providers. But it's also, what we saw at Desktone that went into Veeam. It's, our customers are also doing it as a service within their organization. Things like multi-tenancy are things that they need and scalability are things that they need as a business, so it's a lot of similarities between the world that I lived in and Desktone and VMware to where we are today. >> One of the impressive stats, you said 2016, 231,000 customers that you have. Are all of those paying customers, you have the free version, can you give us any insight as to how many pay versus free >> It's actually over 245,000, that was at the end of the year, so we're adding 4,000 new customers every month and those are all paid. We don't count the people who downloaded the free version of it. >> That's good to know, you could have millions of >> We have millions so far our other free products, yes. >> Awesome. >> Millions of users. >> That's important. >> And another stat you put out in the keynote was an NPS of 73 which is really, really good. Can we talk about that a little bit? Ratmir you were making the point off camera that it rose from the low 60s. What's going on there? >> Yeah so last year it was 61, the year before it was 62, so we were kind of very high but flat, so and this year it actually jumped to 73 and the reason that I personally contribute that to is because we had extremely powerful release 9.5 and customer are extremely happy with the improvements, and the easy of operate and using all these new capabilities, it was the most, the smoothest upgrade, the smoothest release and with the powerful features. The second reason I think our NPS, net promoter score, rose that much is because Peter came on board. (laughs) So in the last 10 month, Peter really, really strengthen our team. I thought that we are moving very fast but now, so we have the concept of Veeam speed, that means moving really fast but now we, actually with Peter we are moving 10 times faster, all of magnitude faster. >> I don't believe it's me but I think what Veeam has always done is done a really good job of listening to our customers and communicating with our customers on a regular basis. We built at a customer success business, part of our business that we're investing in, but we have a whole, a team of people who just solicit and communicate with our partners, and our customers on a regular basis, so they know what we're doing, it's rare that they don't really get a good sense of where we're going and the vision and strategy of Veeam so I think that goes a long way in driving our NPS score. >> We got to break but last thing we really haven't double clicked on is the ecosystem, maybe a quick word on that and then we'll wrap. >> That's a big, obviously, a partner community, we have 45,000 partners, we have 15, over 15,000 managed service providers in cloud. Probably the area that is impacting our business quite a bit now recently is a lot of the alliance partnerships that have. Today we have Veeamware, we have Cisco, very strong and successful, we announced HPE which not only is a development partnership but also a resell partnership and go to market which is dramatically impacing >> Former competitor. >> Yes yes which has opened up a tremendous amount of opportunities for us so we're going to continue to expand into other companies, we're, because 50% of this market is changing over in 2017 and 18, from legacy solutions to new, in the hardware is a piece of that and we're trying to embed as much of that into one sales motion, one bundle for our customers, making it easy to try and buy Veeam. >> Okay, founder gets the last word, bumper sticker when the buses are pulling away, the trucks are pulling away from New Orleans, what's the bumper sticker on VeeamOn 2017? >> See you in 2018. (laughs) Let's have another great year, and another stick with Veeam. >> We find out I think Thursday where 2018 is going to happen. >> Yes. >> Alright so stay with us alright thanks Gents for coming to The Cube. >> Excellent, thanks for having us. >> You're welcome alright keep it right there buddy we'll be back with our next guest, The Cube are live from VeeamOn in New Orleans, be right back. (funky electronic theme music)